We write with respect to the news article entitled “China Telecom PHL partner sees profit for venture by 2026“ posted in BusinessWorld (Online Edition) on August 26, 2022. The article reported in part that:
“China Telecommunications Corp.’s Philippine venture expects to post its first profit in as early as four years, the majority shareholder of the Southeast Asian nation’s third mobile-phone provider said.
A positive bottomline ‘will emerge’ for DITO Telecommunity Corp. by 2026 or 2027, said Ernesto R. Alberto, president of DITO CME Holdings Corp. that’s owned by businessman Dennis A. Uy. . . . . The telecom venture’s earnings before interest, taxes, depreciation and amortization is also on track to be positive as early as end-2024 ‘assuming no event risk,’ Mr. Alberto said.
DITO CME may sell down its 53% stake in DITO Telecom to raise its equity share to help fund venture’s expansion and has asked banks to find it an ‘ideal private equity placement partner,’ Mr. Alberto said.
Still, the DITO CME president said a preferred option is to use its share in DITO Telecom to raise its share of equity component with a 2-3 year loan with balloon payment. ‘We are confident that the value of shares will be much more — barring of course, event risks — two, three years down the road,’ he said, adding that talks are on with foreign and local lenders on this ‘bridge facility.’
DITO Telecom is also optimistic that it will complete by November talks with a group of lenders led by Bank of China for a $4.1 billion long term loan to fund rollout of its network which is required to have 84% population coverage by 2024.
By 2024, DITO Telecom ‘will be on even keel competition with the incumbents in terms of capacity but with a much more brand-new network without any legacy baggage,’ Mr. Alberto said.
. . . .”
Please note that profit picture forecasted by 2026, as well as positive EBITDA as early as end 2024, are business projections made by the DITO Telecommunity’s management and conveyed as part of the business plan briefing updates periodically conveyed by management. These projections prepared by Dito Telecommunity’s management, however, are subject to changes and adjustments based on dynamics and shifts in macroeconomic and market conditions which affect the business.
In addition, the possibility of DITO CME’s sell down of its stake in DIto Telecommunity is always a business-driven option available to any investor desiring to raise liquidity. But do note that these options are taken together with other options such as the long-term loan option and/or finding an ideal private placement partner.
Also, please note that the statements contained in the news article contains certain forward-looking statements relating to the Company that are based on the beliefs of the Group’s management as well as assumptions made and information currently available to the Group’s management. These forward-looking statements are, by their nature, subject to significant risks and uncertainties. These forward-looking statements include statements relating to the Group’s business prospects, future developments, trends and conditions in the industry, and geographical markets in which the Company and the subsidiaries it operates.
These forward-looking statements reflect the Company’s views at the time such statements were made with respect to future events and are not a guarantee of future performance or developments. Reliance on any forward-looking statements involves known and unknown risks and uncertainties. Actual results and events may differ materially from information contained in the forward-looking statements as a result of a number of factors. Accordingly, you should not place reliance on any forward-looking information or statements. All forward-looking statements herein are qualified by reference to the cautionary statements set forth herein. |